State officials begged the Trump administration Wednesday to keep making critical Obamacare payments to insurers, but the White House refused to offer any long-term commitment, heightening uncertainty as health plans begin to set their rates for 2018.
The relatively arcane payments have again become a surprising flash point in Washington’s fight over health care, with insurers saying they could raise premiums by more than 20 percent if they don’t have assurances they’ll continue to get taxpayers’ money.
California’s insurance commissioner said a 12.5 percent premium raise already expected for next year would likely double if President Trump halts what’s known as cost-sharing payments.
The National Governors Association said markets already reeling from dwindling choices and rising costs can’t handle the additional uncertainty Mr. Trump is causing.
“The Administration has the opportunity to stabilize the health insurance market across our nation and ensure that our residents can continue to access affordable health care coverage,” said Virginia Gov. Terry McAuliffe, a Democrat, and Massachusetts Gov. Charlie Baker, a Republican.
Mr. Trump allowed Treasury to make last month’s payment but hasn’t committed to anything beyond that.
“We’ve said, from the very beginning, the time that he got into office, that we’d look at these on a month-by-month basis. And that position has not changed,” White House Budget Director Mick Mulvaney told CNN.
Mr. Trump has suggested he might yank the payments as a way to pressure Capitol Hill to take another stab at repealing and replacing Obamacare.
Congress has never approved the payments, and when President Obama made them anyway, the GOP-led House took him to court. A judge ruled the payments illegal but has stayed her decision while it’s under appeal.
A federal appeals court late Tuesday said more than a dozen Democratic state attorneys general may step in and defend the payments should Mr. Trump attempt to drop the case.
Analysts said the judges’ order, which highlighted the Trump team’s “accumulating public statements” about no longer representing the states’ interest in preserving the payments, will make it harder for Mr. Trump to blame any decision to cut off the money on the court’s prior ruling.
“The legal question is still open, and if the president decides to end the payments, it will be his own decision, which will likely be challenged in another lawsuit and may possibly be stopped by the appellate court if the states ask it to stay any termination of the CSRs pending a determination on the merits,” said Timothy Jost, a law professor at Washington and Lee University in Virginia who closely tracks the 2010 health law.
Last weekend, White House counselor Kellyanne Conway said Mr. Trump would make a decision on whether to continue the payments this week. It hasn’t happened yet.
“We will keep you posted when we have a final announcement on that,” White House press secretary Sarah Huckabee Sanders told reporters Wednesday.
The governors association said it needs an answer soon, because insurers are trying to set rates for 2018 by mid-September.
“It is critically important to provide insurers and states with certainty that CSRs will be funded,” they said as the fight shifts from Capitol Hill to the states.
Congressional Republicans, weary from the health care fight, largely have moved on to tax reform and other business ahead of a lengthy August recess.
Senate Health Committee Chairman Lamar Alexander said he will push for a bipartisan, short-term bill to stabilize the individual insurance markets when lawmakers return in September, as exchange customers in 20 counties across Nevada, Indiana and Ohio face the prospect of having no choices at all next year.
The Tennessee Republican said the cost-sharing payments should be funded, at least temporarily, as part of those efforts.
But some conservatives are still fuming about the GOP’s failure to dismantle Obamacare after seven years of campaign promises to kill the 2010 law. They want to keep trying.
“I think it would be a serious mistake to bail out the insurance companies instead of honoring our promise to repeal Obamacare and provide real relief for the millions of Americans who have been hurt by Obamacare,” Sen. Ted Cruz, Texas Republican, told reporters Wednesday.
White House officials said Mr. Trump supported the payments as a stop-gap measure to get to a GOP replacement, but isn’t keen on them after Republicans failed to put a repeal bill on his desk.
Mr. Mulvaney said “the president’s attitude is fairly simple: If people are suffering, and they are, and they will continue to suffer because we have not repealed or replaced Obamacare, why shouldn’t insurance companies similarly suffer?”
For their part, insurers say they do not profit from the payments and are seeking what they’re owed under the contours of the law, which directed the federal government to reimburse participating health plans.